Crypto Bull Run: Probability Of Fed Rate Cuts In September Almost At 100%

Source Newsbtc

Expectations surrounding possible rate cuts by the Federal Reserve in September are nearing peak levels, especially among crypto investors. Historically, Fed rate cuts have often meant the start of a bull run since it signals to investors to take more positions in risk assets such as Bitcoin and crypto. Thus, with only two weeks left to the next FOMC meeting, votes are already coming in for what the Fed will do and how the crypto market will react.

Probability Climbs Above 97%

The CME Watch Tool from the CME Group website is now showing the highest probability so far for a Fed rate cut in September. The percentage had fluctuated over the month of August, rising above 92% and then falling back to 75% again as different developments popped up. However, as the market entered the month of September, sentiment has skewed completely toward the positive, and the probabilities have risen drastically.

Bitcoinist had reported that the probability had fallen to 75% toward the end of August. But now the figure is back again, reaching the highest level so far, ahead of the FOMC announcement. The Fed Watch Tool now reads a 97.6% chance that the Fed will cut rates this September and trigger another bull run.

This figure means that there is now only a 2.4% probability that the Fed would choose to keep rates at the same level as they did the last time. In contrast, there is still a 0% chance that there will be a rate hike this September. In fact, there have not been talks of a Fed rate hike for months now, suggesting that all focus remains on the rate cuts.

Crypto Fed rate cuts

How The Crypto Market Could React

Naturally, a Fed rate cut is bullish for both the stock and crypto markets as it allows investors to take on more risks. This triggers a flow of liquidity into the market, driving up prices rapidly, while also increasing the volatility of the market at the same time.

The expectation is that the crypto market could rally off the news, especially as US President Donald Trump has been in support of rate cuts for months now. However, there is also the need to be cautious due to high expectations often leading to dashed hopes.

In a report, the on-chain data analytics platform Santiment revealed that social conversations with the words “Fed”, “rate”, and “cut” had risen to the highest level in almost one year. This suggests a lot of bullishness already surrounding the FOMC meeting. But periods like these have often marked the top, leading to a possible “buy the rumor, sell the news” event.

If the latter is the case, then it would mean that prices could rise leading up to the FOMC meeting and then crash if the announcement is different from expectations. Thus, it would be wise to be cautious around this period, especially with the expectation of high volatility.

Crypto total market cap chart from TradingView.com
Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Bitcoin ETF Inflows For 2025 Now Outpace 2024, Data ShowsUS Bitcoin spot exchange-traded funds (ETFs) have seen more inflows this year so far compared to the same point in 2024, according to data.
Author  Bitcoinist
Jul 16, Wed
US Bitcoin spot exchange-traded funds (ETFs) have seen more inflows this year so far compared to the same point in 2024, according to data.
placeholder
Gold Price Forecast: XAU/USD gains momentum to near $3,650, eyes on US CPI releaseThe Gold price (XAU/USD) gains momentum to near $3,645 during the early Asian session on Thursday.
Author  FXStreet
Sep 11, Thu
The Gold price (XAU/USD) gains momentum to near $3,645 during the early Asian session on Thursday.
placeholder
Silver Price Forecast: XAG/USD retreats from 14-year highs to below $45.00Silver price (XAG/USD) attracts some sellers to near $44.80 after reaching its highest in over 14 years during the Asian trading hours on Friday.
Author  FXStreet
Sep 26, Fri
Silver price (XAG/USD) attracts some sellers to near $44.80 after reaching its highest in over 14 years during the Asian trading hours on Friday.
placeholder
US core PCE inflation set to rise 2.9% YoY in August with Federal Reserve easing outlook in focusThe United States (US) Bureau of Economic Analysis (BEA) will publish the Personal Consumption Expenditures (PCE) Price Index data for August on Friday at 12:30 GMT. 
Author  FXStreet
Sep 26, Fri
The United States (US) Bureau of Economic Analysis (BEA) will publish the Personal Consumption Expenditures (PCE) Price Index data for August on Friday at 12:30 GMT. 
placeholder
ETH Whales Buy the Dip as Ethereum Breaks $4,000 SupportEthereum (ETH) whales are capitalizing on falling prices as the second-largest cryptocurrency continues to trend downward, breaking the critical $4,000 level.
Author  Beincrypto
Sep 26, Fri
Ethereum (ETH) whales are capitalizing on falling prices as the second-largest cryptocurrency continues to trend downward, breaking the critical $4,000 level.
goTop
quote